1. A Division Bench of this Court has referred the following question of law arising under the provisions of the Karnataka Rent Control Act, 1961 for the opinion of the Full Bench.
'Whether a property which was an agricultural land at the time of letting and had ceased to be agricultural land an the date of the petition for eviction is a 'Premises' within the meaning of Section 3 (n) of the Karnataka Rent Control Act, and would attract provisions of Sections of Section 21 of the Act?''
2. The matter arises out of Proceedings for eviction under proviso to Section 21 (1) of the Karnataka Rent Control Act, 1961 (hereinafter called the 'Act') instituted by the petitioner against respondents in H. R. C. No. 287 of 1968 on the file of the Mummify, Hubble, respecting certain lands which, at the time of letting, were agricultural lands; but, which as on the date of institution of the Proceedings came within the limits of Hubli-Dharwar Municipal Corporation and used by the lessees, admittedly, for industrial purposes, the lessee having, in terms of and enabled by the lease deed, erected buildings and structures thereon for industrial purposes. Eviction was sought on grounds of alleged sub-letting.
3. The facts leading up to the refer are set out in the order of references dated 12th Dec, 1977, and' it is Dot necessary to set them out in extenso again here, Very briefly stated, they are these:
The predecessors in title of the petitioners granted a lease of the land in question in flavor of the first respondent. under the deed dated 14th December, 1887. On 29th July, IBM the lessee surrendered a portion of the land covered by the original lease but then on 7th March, 1904 the portion so surrendered, was leased again in flavor of the first respondent. In 1907, the property was permitted to be converted into nonagricultural user by the Revenue Authorities and it is common ground that the property has been, in fact, so used ever since One of the grounds on which petitioner has been non-suited by the Courts below is that the land in question, having been, an agricultural land as on the date of lease could not be considered. to be 'premises' within the meaning of Section 3 (n) of the Act, attracting the provisions of Section 21, though as on the date of the institution of the Proceedings, the lands admittedly were Put to non-agricultural use. This view Proceeded on the basis that the relevant date for purposes of ascertaining whether the land is 'premises' within the meaning of Section 3 (n) of the Act was the date of letting. The pronouncement of a Division Bench of this Court in Audrey V. Gangways (1976) 1 Kant LJ 409, which supports this proposition In turn relied for its conclusion on the judgment of the Supreme Court in Subaru v. Nisei Chianti : 3SCR98 . The Division Bench whose attention was invited to a subsequent decision Of the Supreme Court in Valued Dhanjibhai Modi y. Rajah Abdul Iranian : 1SCR66 for the contrary proposition, was of the opinion that there was an element of irreconcilability between the views expressed in Subhadra's case on the one hand and Vasudev Dhanjibhai Modi's case on the other and that it should follow the former on the principle that the bench that decided the former case was the larger of the two benches. The referring bench was of the opinion that there was no element of irreconcilability in the views expressed in Subhadra's case and Vasudev Dhanjibhai Modi's case and that the decision in Rudrayya's case requires reconsideration.
4. When this matter came up before the Full Bench earlier, the bench postulating a possibility of its being called upon to consider as to which decision of the Supreme Court should be followed when there is a conflict in its pronouncements referred that limited question for the opinion of a larger bench of five Judges. That question, having come before a bench of five Judges of this Court, has since been pronounced upon by the larger bench to the effect that, if two decisions of the Supreme Court on question of law are mutually irrevocable, then the decision of the larger bench, Hough earlier in point of time should be followed. On the cognate question as to what the High Court should do if both the benches of the Supreme Court consist of equal number of Judges, the five Judges bench by a split decision, held that in such as the later of the two decisions should be followed. In the view we are persuaded to take of the present matter, we think that this aspect may not become apposite in the context of the decision of the question referred for opinion and that aspect as become purely academic inasmuch as the question of choosing between two mutually conflicting views of the Supreme Court, does not, in our opinion, arise here.
As the effect of the pronouncements of the Supreme Court in Subhadra's case and Vasudev Dhanjibhai Modi's case under the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (Act 57 of 1947) are pressed into service by the learned counsel during the arguments it is necessary first to examine the relevant provisions of the Bombay Act in relation to corresponding provisions of the Karnataka Act and the question falling for determination in said two cases.
In Section 5(8) of Bombay Act (Act 57 of 1947) the expression 'premises' is defined inter alia to mean, unless there is anything repugnant to the subject or context, 'any land not being used for agricultural purposes', Section 3 (n) of the Karnataka Act defines the premises to mean:
'(i) A building as defined in clause (a);
(ii) any land not used for agricultural purposes.'
Section 6(1) of the Bombay Act (Act 67 of 1947) provides:
'6 (1) In areas specified in Schedule 1, this Part shall apply to premises let or given on licence for residence, education, business, trade or storage.'
(Rest of the provisions deleted as unnecessary)
Referring to provisions in Section 5(8) of the Bombay Act and, Section 3 (n) of the Act, the division bench In Rudrayya's case observed:
'The above observations show that what was considered material was that the appellant in that case had to establish that the plot of land leased was 'premises' within the meaning of Section 5 clause (8) of the Bombay Act and that it was unnecessary to consider whether the plot was let for residence, education, business, trade or storage.'
'It is thus clear that the definition of premises in the Act is similar to the definition in the Bombay Act. What - is material is that under both the Acts any land not used for agricultural purposes, is excluded from the definition of the word 'premises'. It is also clear that a farm building is excluded from the definition of the word 'building' and therefore of 'premises' in the Bombay Act and of a 'farm house' in the Act. Since the property in question was used only for agricultural purposes on the date of the lease it follows that in the present case also the Act excludes it from its operation.' Hence we are of the opinion that the statement of the law by the larger Bench in Subhadra's case is binding on us and we have to follow the same in preference to the decision of the smaller Bench in Vasudev's case. The unreported decision of the Supreme Court in Krishna Pasuba Rao v. Dattraya Krishnaji (since reported in AIR 1966 SC 1024) by a Bench of three learned Judges which is relied on by Mr. Swamy also supports the view taken in Subhadra's case'.
5. As reliance has been placed by the division bench on Subhadra's case in preference to the view in Vasudeva's case, we may briefly refer to these two decisions.
Facts in Subhadra's case were these
A certain Bai Jekor and her two sisters owned plot No. 68 of Town Planning Scheme No. 1 Jama1pur, Ahmedabad. Under a lease dated 15th October, 1934 the owners granted a lease of this land in perpetuity to certain Gajjar brothers. On 7th February 1946, the Gajjars sublet the plot, also in perpetuity to the respondent Narasaji Chennaji Marwari who, in turn by deed dated 25th April, 1947 sublet the plot to appellant Subha All the deeds provided that the lessees may construct buildings on the demised land. As on the dates of all the three lease the plot was assessed for agricultural purpose, sanction for non-agricultural user of the plot was accorded by the Collector of Ahmedabad only on 14th November, 1949. Thereafter i.e. on 27th October, 1950, Subhadra applied to the Court of Small Causes, Ahmedabad, for fixation of standard rent of the plot under Section 11 of the Bombay Act 57 of 1947. The Supreme Court, affirming the decision of the High Court in this behalf, held that the plot could not be regarded as 'premises' inviting the application of the Part 11 of the Act and that an application for fixation of standard rent was therefore maintainable Shah J. as he then was observed:
'...........In the year 1947, the plot was undoubtedly lying fallow, but on that account, the user of the land cannot be deemed to be altered. User of the land could only be altered by the order of the Collector granted under Section 7 of the Bombay Land Revenue Code There is no dispute that Part 11 applied to the area in which the plot is situated; but before the appellant could maintain application for fixation of standard rent under Part II, she had to establish that the plot of land leased was 'premises' within the meaning of Section 5(8) of the Act and that it was let for residence, education, business, trade or storage. For the purposes of this appeal, it is unnecessary to consider whether the plot was let for residence, education business, trade or storage 'After referring to the provisions of Section 5(8) of the Act, His Lordships proceeded to say:
'(3) Reading Section 5 sub-clause (8) with Section 6(1) it is manifest that para II of the Act can apply in areas specified in Sch. II to Lands (not being used for agricultural purposes) let for residence, education, business, trade or storage. The material date for ascertaining whether the plot is 'premises' for purposes of Section 6 is the date of letting and not the date on which the for fixation of standard rent is made by the tenant or the landlord. We agree with the High Court that the plot in dispute could not be regarded as 'premises' inviting the application of Part of the Act. The application filed by the appellant under Section 11 for fixation of standard rent was therefore not maintainable.'
In Vasudev's case, the facts were:
Appellant Vasudev Dhanjibhai Modi was the owner of No. 15/3 of Jamalpur Town Planning Scheme, Ahmedabad. Since 1948, one Rajabhai Munshi was a tenant of the land at an annual rental of Rs. 411. Alleging that Munshi had committed default in payment of rents, Vasudev instituted a suit in the Court of Small Causes, Ahmedabad, for an order of ejectment and for recovery of rent in arrears. The Trial Court dismissed the action; but the appellate Court granted a decree for ejectment. The High Court of Bombay affirmed the decree of the appellate Court. However on the execution side, Munshi raised the contention that the Court of Small Causes had no jurisdiction at all to entertain the suit, as according to him, Parts II and III of the Bombay Act 57 of 1947 did not apply to open lands and that the entire proceeding culminating in the order of affirmance of ejectment made by the High Court were without jurisdiction. The executing Court rejected this objection. Appeal against that rejection was also unsuccessful but in a petition filed under Art. 227 by Munshi the High Court reversed these decisions. The landlord Modi came up to the Supreme Court by special leave. The Supreme Court reversing the decision of the High Court and restoring that of the Court of Small Causes observed: (Per Shah, J.)
'4. The expression 'premises' in Section (8) of the Bombay Rents Hotel and Lodging House Rates Control Act 57 of 1947 does not include premises used for agricultural purposes. By Section 6 of that Act, the provisions of Part II which relate to conditions in which orders in ejectment may be made against the tenants and other related matters apply to premises let for education, business, trade or storage. It is plain that the Court exercising power under the Bombay Rents Hotel and Lodging House Rates Control Act 1947, has no jurisdiction to entertain a suit for possession of land used for agricultural purposes, Again ascertaining whether the land demised is used for agricultural purposes, the crucial date is the date on which the right conferred by the Act is sought to be exercised; Miss. Subhadra v. Narsaji Chennaji Marwadi, : 3SCR98 .
'8. In the present case the question whether the Court of Small Causes had jurisdiction to entertain the suit against Munshi depended upon the interpretation of the terms of the agreement of lease, and the user to which the land was at the date of the grant of the lease. These questions cannot be permitted to be raised in an execution proceedings so as to displace the jurisdiction of the Court which passed the decree. If the decree is on the face of the record without jurisdiction and the question does not relate to the territorial jurisdiction or under Section 11 of the Suits Valuation Act, objection to the jurisdiction of the Court to make the decree may be raised; whether it is necessary to investigate facts in order to determine whether the Court which had passed the-decree had no jurisdiction to entertain and try the suit, the objection cannot be raised in the execution proceedings.'
6. Sri B. V. Jigjinni, learned counsel for the petitioner, submitted that in Rudrayya's case the Division Bench proceeded on the erroneous premise that the propositions laid down by the Supreme Court in regard to the question on hand in Subhadra's case and Vasudev's cage were in fact, mutually irreconcilable and (sic) that as that view and adopting guidelines laid down by the Supreme Court in Mattulal v. Radhe Lal, : 1SCR127 , followed the ruling in Subhadra's case as that was the decision of the larger bench. He contends that there was no conflict between the two decisions at all and that while what was laid down in Subhardra's case as to the point of time with reference to which the matter has to be decided was in the context of the purpose of letting contemplated under See. 6 (1) the decision in Vasudev's case, on the other hand, was in relation to the point of time apposite in the context of Section 5(8) of Bombay Act 57 of 1947. This distinction, according to Sri Jigjinni, is an incident of and stems from the scheme of the Bombay Act which makes the purpose of letting determinative under Section 6(1) and that under the Bombay Act, in certain areas, both the requirements of Section 5(8) and Section 6(1) were required to be satisfied in order that the provisions of the Act are attracted. Sri B. V. Jigjinni further contends that in Subhadra's case, the question pronounced upon was as to the point of time with reference to which requirement of Section 6(1) should be satisfied, while in Para-4 of Vasudev's judgment, the point of time with reference to which the requirements of Section 5(8) has had to be satisfied came to be dealt with.
7. Sri W. K. Joshi, however, sought to maintain that while the observations of the Supreme Court were clear in Subhadra's case the observations in Para 4 in Vasudev's case cannot be taken to detract from the position obtaining in Subbadra's case. The reasons for these, according to Sri Joshi, are two: The first is that Vasudev's case was decided by 3 Judges, and did not have the effect of overruling Subhadra's case. Secondly, according to Sri. Joshi, the observations in Para 8 in Vasudev's case clearly detract from and are irreconcilable with the earlier observations in Para 4. Sri Jigjinni endeavoured to maintain that there was no such discordance in the ideas in para 4 of Vasudev's judgment on the one hand and Para 8 on the other, inasmuch as, according to Sri Jigjinni, in Para 8 the Supreme Court was dealing with that part of the contention of the tenant Munshi as to the non-applicability of the provisions of Parts II and III to the land in question, a contention which would turn on the question whether the requirements of Section 6(1) were satisfied or not. It appears to us unnecessary in the present case to examine the merits of these rival claims as to the exact scope of the two pronouncements of the Supreme Court. It is plain that the scheme of the Bombay Act and that of the Karnataka Act are not wholly analogous on this aspect. The position as to the requirements of satisfaction of the provisions of both Section 5(8) and Section 6(1) obtaining under the Bombay Act does not obtain under the 'Act'.
8. Secondly, if the Supreme Court itself in a later decision adverts to its earlier decision and lays down-the import of the former on any aspect, that, in our opinion, is and ought to be conclusive so far as the High Court is concerned, and the High Court cannot be called upon to embark upon an engagement of searching out possible points of controversy or discordance in the two pronouncements. Whenever it is urged before it that there is an element of irreconcilability in the pronouncements on any proposition of law by the Supreme Court, the proper course for the High Court is, first, to try to find out whether the apparently differing notes are really different at all. This task of the High Court is rendered all the lighter if the Supreme Court itself has, or must be taken to have, explained the earlier pronouncement. In the present case, the same learned Judge, Shah, J., who rendered the decision in Subhadra's cue has in para 4 of Vasudev's cam stated what the law on the matter is Are we to embark upon a further enquiry? The answer to this, from the points of view of principle and propriety must necessarily be in the negative.
Indeed, we may here advert to another decision of the Supreme Court in Mrs. Dossibai v. Khemchand, : 3SCR928 , in which adverting to what satisfied the requirements of Section 5(8) of the Bombay Act (57 of 1947), Das Gupta, J., stated:
'3. Under Section 5, sub-section (8) of the Rent Act unless there is anything repugnant in the context 'premises' means, among other things 'any land not being used for agricultural purposes'. It is undisputed in these cases that the land in respect of which the suits were brought was not being used for agricultural purposes -and so comes within the definition of 'Premises' in Section 5'.
In an obvious reference to the requirements of Section 6, the Supreme Court stated:
'(7) The more substantial question for consideration is whether open land is being leased not to be used for residence in its condition of open land but to be used for the purpose of residence after constructing buildings thereon, the letting of the open land can reasonably be called to be letting for residence .........'
'(8) It seems to us that when people speak ordinarily of land being let for business, they are only thinking that the ultimate purpose behind the letting is that business will be carried on and they are not thinking whether the business will be carried on the land in its present state or by the construction of temporary sheds or by putting up permanent buildings. Similarly, when a man says that he will take lease of a plot of land for storage of his goods, what he has in mind is that by taking lease of the land he will achieve the object of storing goods, irrespective of whether for such storage he will have to put up a structure or not in the same way we think that when land has been let for the purpose of constructing buildings for residence, people will say that it is being let for residence, just as they will say that the land has been let for residence if the lessee intends to use it as caravan site so that the people may live on the open land in caravans'.
From what emerges from the above passages, Sri Jigjinni's contention that observations in Subhadra's case as to the criterion which requires to be established with reference to the point of time of letting was the criterion germane only to Section 6(1) may not altogether be unarguable. The pronouncement of the Supreme Court in Mrs. Dossibails case is that if the lease deed expressly intends and enables a prospective nonagricultural user of the Demised land, which was otherwise an agricultural land as on the date of letting, the purpose of the letting would still be the intended prospective user and not merely the actual user as on the date of letting. On this premise an argument would, perhaps, be available to Sri Agjinni that even if the relevant date is the date of letting, the land in the present case would still be 'premises' within the meaning of the Act in view of the intended user, Be that as it may, it is unnecessary here to explore the possibilities of and the logical conclusions to which this argument could be pushed in view of the plain provisions of Section 3 (n) of the 'Act', and in view of the pronouncement of the Supreme Court in Vasudev's case bearing on an analogous language of Section 5(8) of the Bombay Act.
9. A statute contains, In the form of an interpretation clause, a little dictionary of its own in which it endeavors to define the chief terms used. The 'Act' in Section 3 (n) defines the expression 'premises, to mean 'any land not used for agricultural purposes'. With reference to what point of time this condition should be shown to exist, would be the question. Such a question can rarely be solved otherwise than by an examination of and with reference to the concerned statute itself 'and its objects and purposes. The plain meaning of and clause 3 (n) of the Act is that in order that land is 'premises' by the statutory standards it must be land 'not used for agricultural purposes'. There is no provision in the 'Act' which freezes this condition with reference to or as upon any particular point of time. The 'Act' being a piece of beneficial legislation ushered in with a view to creating status and interfering with the freedom of contract on certain aspects of the relationship of landlord and tenant and which is intended to afford protection to the tenants in certain cases must be so interpreted as to suppress the mischief and advance the remedy. In this task the interrelation between interpretation clause and the other substantive provisions also require to be so harmonized as to integrate with the objects eatable value?. Is the of the legislation. Ascertainment of the initial date of the letting, or is it the question whether the condition or quality date when possession is sought by the of the land accords with the requirement landlord of clause 3 (n) with reference to, any in any judgment, the test of rateable point of time other than the point at value under the old control is to be which either protection granted by the determined when the landlord' seeks to statute is asserted or the right conferred enforce his by it is sought to be enforced, would his. The time when become divorced of the purpose and these proceedings were brought the rate seem unrelated to the objects of the able value of this woodland or caravan legislation. This, in our opinion, is the site was F.9 and the rateable value of key to the enfoldment of the under the cottage was F.4; therefore, the whole standing of the clause 3 (n). Thus under ceases to be within the Rent Restrictions stood, it becomes clear that the point of Acts, and the plaintiff is entitled to pod- at which the requirement of session clause 3 (n) should be satisfied would (Underlining ours) be the point of time at which either 'the The principle stated above applied to. The protection given under the 'Act' is sough to be asserted or a right conferred by it is sought to be enforced.
10. In Davie's v. Gilbert ((1955 1 All ER 415), the Court of Appeal was dealing with the question whether a cottage and a certain extent of woodland attached thereto were within the protection of the Rent Restrictions Act. In 1937, the then owner let the cottage and the woodland to the defendant. The cottage at that time was rated at 4 per year the woodland had of been rated. In 1938 defendant cleared the undergrowth and opened a caravan-site. In 1953 the caravan site was rated at 99 a year, but the cottage continued to be rated at 24 a year. Plaintiff who was the transferee of the landlord's interest sought possession seeking to put the land for agricultural use. Denning, L. J., upholding the order denying protection to the tenant under the statute and granting possession stated:
'The first question is whether on September 1, 1939, the property came within the old control. If it came within the old control, it remains governed by the Acts relating to, old control and is not governed by the Rent and Mortgage Interest Restrictions Act, 1939. The question whether it came within old control in 1939 depends on this: What was the rateable value of the cottage?
xxx xxx xxx
What, however is the effect of the new rating in 1953? this caravan site has now been rated at 9 a year. That is more than a quarter of the rateable value of the cottage, which remains it 24. Does this new rating take the premises out of old control? This raises the question: What is the proper time for the test of rateable value? Is it the initial date of the letting or is it the date when possession is sought by the landlord?
In my judgment the test of rateable value under the old control is to be determined when the landlord seeks to enforce his rights. At the time when these proceedings were brought the rateable value of this woodland or caravan site was 4: therefore, the whole ceases to be within the Rent Restrictions Acts, and the plaintiff is entitled to possession..........'
11. It appears to us that on a plain understanding of Section 3. (n) it would be clear that the relevant point of time at which requirement of Section 3 (n) must be shown to exist is the point of time at which either the protection granted by the statute is sought to be asserted or a right conferred by the statute is sought to be enforced. The view of Shah, J., in Vasudev's case in relation to Section 5(8) of the Bombay Act accords with and supports our view.
12. It is, however, to be emphasized that the nature of the user of the property let must, with reference to the date 'of assertion of the protection or enforcement of the right under the Acts not be an unlawful or impermissible one.
13. The view taken in Rudrayya's case proceeding, as it) case on the footing that the pronouncement of Shah, J., in Vasudev's case conflicts with Subha case and ought not to be followed cannot be said to have laid down the correct law. With great respect, we are unable to bring ourselves to agree with the conclusion reached by the Division Bench. Accordingly, overruling the decision in Rudrayya's case, we express the opinion that a property which was an agricultural land at the time of letting and which ceased to be agricultural land on the date of the petition for eviction is 'premises' within the meaning of Section 3 (n) of the 'Act' attracting the provisions of Section 21 of the 'Act'.
14. Answer accordingly.